Dec 05, 2011, 10.47 PM IST
We say ‘Financial Planning’ is not rocket science but plain and simple common sense. It is deciding what are the goals, how much is needed for each of them and then making choices from various options for the best way of achieving these goals with least possible risk.
By Lovaii Navlakhi
We say ‘Financial Planning’ is not rocket science but plain and simple common sense. It is deciding what are the goals, how much is needed for each of them and then making choices from various options for the best way of achieving these goals with least possible risk. So you can ask if it’s so simple, why have a financial planner – why not simply do this yourself?
Well, the answer to this is Yes, you can. In fact, you are your own best planner, after all who else will be as motivated to get the best out of your money and achieve your goals?
But the constraints that come up are time and knowledge. You need time to monitor your portfolio frequently, track the markets, keep a close watch on the economy and political scenario, interpret changes in policies, follow world indices, understand and evaluate the new options coming in almost every day; AND do your regular job. More, you need to have the knowledge and training to understand markets, governments, economies and products; and deduce and react to its changes appropriately and timely.
With markets and economies world over becoming more and more global and inter connected, something happening in a far away corner of the world can have major consequences on investments here. Further, besides threats there are equally a myriad of investments and options opening up for Indian investors across geographical boundaries that you need to be aware of and evaluate.
While there is a mass of data and information out there courtesy real and purported experts, it is a quite a task to decipher this information correctly and use only what is relevant to you.
So in these times of outsourcing doesn’t it make sense to have a professional do this for you? You have a qualified and experienced person to looking out for your financial interests and time to do other stuff in your life.
Finally, often a certain amount of emotional distance and detachment is required while taking some financial decisions specially like realising it is time to get out of an investment which you often put off since having developed sentiments towards it. Or not getting swayed or pressurised by marketing hype or crowd mentality or mass panic. And there is always the stick that is sometimes required to be wielded to force you to buy adequate insurance cover, write a will, organise the bank accounts or set nomination details properly and stop procrastinating.
So get a financial planner – to take your money worries away and leave you free to enjoy life with a sense of relief that your money is being well looked after.
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